The Supreme Court case California et al. v. United States in 1977 revolved around the conflict between state and federal authority over water resources, specifically regarding the construction of a dam and reservoir project by the U.S Bureau of Reclamation in California's Central Valley. The State of California argued that it had rights to impose conditions on this project under its own laws, while the Federal Government contended that it was not subject to these state-imposed conditions due to supremacy clause considerations. The Supreme Court ruled in favor of California, stating that although federal entities have broad powers when undertaking projects like these, they must still comply with reasonable conditions set forth by states so long as those do not obstruct or defeat their purposes. This decision upheld states' rights within their jurisdictional boundaries even when dealing with federally initiated projects.

In the dissenting opinion for California et al. v. United States, 1977, it was argued that the Federal Power Commission (FPC) should not have jurisdiction over non-federal projects on navigable waters within a state's borders unless those projects affect interstate or foreign commerce. The dissenting justices believed that Congress did not intend to give FPC such broad authority when they enacted the Federal Power Act in 1935 and noted that this interpretation had been upheld by previous court decisions. They also expressed concern about potential federal encroachment on states' rights to control their own natural resources and felt that any ambiguity in the law should be resolved in favor of preserving these rights rather than expanding federal power.